STOCKHOLDER SUPPORT AGREEMENT
STOCKHOLDER SUPPORT AGREEMENT dated as of September 1, 1997 (this
"Agreement"), by GE Investment Management Incorporated ("GEIM"), GE
Investment Hotel Partners I, Limited Partnership ("GEHOP" and together with
GEIM, the "GE Entities"), the Trustees of General Electric Pension Trust
("GEPT"), Red Lion, a California limited partnership ("Red Lion"), Richard J.
Ferris ("Ferris"), Ridge Partners, L.P. ("Ridge"), Kelrick, Inc. ("Kelrick"
and together with Ferris and Ridge, the "Ferris Entities"), Peter V.
Ueberroth ("Ueberroth"), The Ueberroth Family Trust ("Ueberroth FT") and The
Ueberroth Investment Trust ("Ueberroth IT" and together with Ueberroth and
Ueberroth FT, the "Ueberroth Entities"), to and for the benefit of Promus
Hotel Corporation, a Delaware corporation ("Promus"). Each of the GE
Entities, GEPT, Red Lion, the Ferris Entities and the Ueberroth Entities are
referred to herein as a "Stockholder" and collectively as the "Stockholders."
Capitalized terms used and not otherwise defined herein shall have the
respective meanings assigned to them in the Merger Agreement referred to
below.
WHEREAS, as of the date hereof, the GE Entities own of record and
beneficially 6,060,981 shares (such shares, together with any other voting or
equity securities of Doubletree hereafter acquired by the GE Entities prior
to the termination of this Agreement, being referred to herein collectively
as the "GE Shares") of common stock, par value $.01 per share ("Doubletree
Common Stock"), of Doubletree Corporation, a Delaware corporation
("Doubletree");
WHEREAS, as of the date hereof, GEPT owns of record and
beneficially 3,027,441 shares (such shares, together with any other voting or
equity securities of Doubletree hereafter acquired by GEPT prior to the
termination of this Agreement, being referred to herein collectively as "GEPT
Shares") of Doubletree Common Stock;
WHEREAS, as of the date hereof, Red Lion owns of record and
beneficially 3,882,283 shares (such shares, together with any other voting or
equity securities of Doubletree hereafter acquired by Red Lion prior to the
termination of this Agreement, being referred to herein collectively as the
"Red Lion Shares") of Doubletree Common Stock;
WHEREAS, as of the date hereof, the Ferris Entities own of record
and beneficially 1,576,182 shares (such shares, together with any other
voting or equity securities of Doubletree hereafter acquired by the Ferris
Entities prior to the termination of this Agreement, being referred to herein
collectively as the "Ferris Shares") of Doubletree Common Stock;
WHEREAS, as of the date hereof, the Ueberroth Entities own of
record and beneficially 1,124,182 shares (such shares, together with any
other voting or equity securities of Doubletree hereafter acquired by the
Ueberroth Entities prior to the termination of this Agreement, being referred
to herein collectively as the "Ueberroth Shares" and, together with the GE
Shares, the GEPT Shares, the Red Lion Shares and the Ferris Shares, the
"Shares") of Doubletree Common Stock;
WHEREAS, concurrently with the execution of this Agreement,
Doubletree, Promus and Parent Holding Corp., a Delaware corporation
("Parent"), are entering into an Agreement and Plan of Merger, dated as of
the date hereof (the "Merger Agreement"), pursuant to which, upon the terms
and subject to the conditions thereof, (i) a newly formed subsidiary of
Parent will be merged with and into Doubletree (the "Doubletree Merger"), and
(ii) a second newly formed subsidiary of Parent will be merged with and into
Promus (the "Promus Merger") such that Doubletree and Promus will become
wholly-owned subsidiaries of Parent and the stockholders of Doubletree and
Promus will become stockholders of Parent; and
WHEREAS, as a condition to the willingness of Promus and Doubletree
to enter into the Merger Agreement and the Stock Option Agreements (as
defined in the Merger Agreement), Promus has requested the Stockholders
agree, and in order to induce Promus to enter into the Merger Agreement and
the Stock Option Agreements, the Stockholders are willing to agree, severally
but not jointly, to vote in favor of adopting the Merger Agreement and
approving the Doubletree Merger, upon the terms and subject to the conditions
set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree, severally and not jointly, as follows:
Section 1. VOTING OF SHARES. Until the termination of this
Agreement in accordance with the terms hereof, each Stockholder hereby agrees
that, at the Doubletree Stockholders' Meeting or any other meeting of the
stockholders of Doubletree, however called, and in any action by written
consent of the stockholders of Doubletree, such Stockholder will vote all of
its respective Shares (a) in favor of adoption of the Merger Agreement and
approval of the Doubletree Merger and the other transactions contemplated by
the Merger Agreement, and (b) in favor of any other matter necessary to the
consummation of the transactions contemplated by the Merger Agreement and
considered and voted upon by the stockholders of Doubletree (or any class
thereof). In addition, each Stockholder agrees that it will, upon request by
Promus, furnish written confirmation, in form and substance reasonably
satisfactory to Promus, of such Stockholder's support for the Merger
Agreement and the Doubletree Merger. Each Stockholder acknowledges receipt
and review of a copy of the Merger Agreement.
Section 2. TRANSFER OF SHARES. Each Stockholder represents and
warrants that it has no present intention of taking any action, prior to the
termination of this Agreement in accordance with the terms hereof, to,
directly or indirectly, (a) sell, assign, transfer (including by merger,
testamentary disposition, interspousal disposition pursuant to a domestic
relations proceeding or otherwise by operation of law), pledge, encumber or
otherwise dispose of any of its respective Shares, (b) deposit any of its
respective Shares into a voting trust or enter into a voting agreement or
arrangement with respect to any such Shares or grant any proxy or power of
attorney with respect thereto which is inconsistent with this Agreement or
(c) enter into any contract, option or other arrangement or undertaking with
respect to the direct or indirect sale, assignment, transfer (including by
merger, testamentary disposition, interspousal disposition pursuant to a
domestic relations proceeding or otherwise by operation of law) or other
disposition of any Shares.
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Section 3. NO SOLICITATION. Prior to the termination of this
Agreement in accordance with its terms, each Stockholder agrees (a) that it
will not, nor will it authorize or permit any of its officers, directors,
employees, agents and representatives to, directly or indirectly, initiate or
solicit any inquiries or the making of any Acquisition Proposal and (b) that
it will notify Promus as soon as possible (and in any event within 48 hours)
if any such inquiries or proposals are received by, any information or
documents is requested from, or any negotiations or discussions are sought to
be initiated or continued with, it or any of its affiliates.
Section 4. TERMINATION. This Agreement shall terminate upon the
earliest to occur of (i) the Effective Time or (ii) any termination of the
Merger Agreement in accordance with the terms thereof; provided that the
provisions of Section 7 shall survive any termination of this Agreement, and
provided further that no such termination shall relieve any party of
liability for a breach hereof prior to termination.
Section 5. REGISTRATION RIGHTS. Until the termination of this
Agreement in accordance with the terms hereof, no Stockholder will exercise
any of its rights to request or require registration of any securities under
the Incorporation and Registration Rights Agreement dated as of December 16,
1993, as amended on June 30, 1994, February 27, 1996 and November 8, 1996, by
and among Doubletree and certain stockholders of Doubletree (the
"Registration Rights Agreement).
Section 6. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement
was not performed in accordance with the terms hereof and that the parties
shall be entitled to specific performance of the terms hereof, in addition to
any other remedy at law or in equity.
Section 7. MISCELLANEOUS.
(a) This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, both written and oral, between the
parties with respect thereto. This Agreement may not be amended, modified or
rescinded except by an instrument in writing signed by each of the parties
hereto.
(b) If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of law, or public policy,
all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the parties as closely as possible to the
fullest extent permitted by applicable law in a mutually acceptable manner in
order that the terms of this Agreement remain as originally contemplated to
the fullest extent possible.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to the
principles of conflicts of law thereof.
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(d) Notwithstanding anything herein to the contrary, the covenants
and agreements set forth herein shall not prevent any of the Stockholders'
designees, partners or affiliates serving on the Board of Directors of
Doubletree from taking any action, subject to the applicable provisions of
the Merger Agreement, while acting in such capacity as a director of
Doubletree.
(e) Notwithstanding any provisions hereof, none of the obligations
of any Stockholder under or contemplated by this Agreement shall be an
obligation of (i) any officer, director, stockholder, limited partner,
general partner or owner of such Stockholder, or any of their respective
officers, directors, stockholders, limited partners, general partners or
owners, or successors or assigns or (ii) any other Stockholder. Each
Stockholder shall be the only person or entity liable with respect to its
obligations. Any monetary liability of a Stockholder under this Agreement
shall be satisfied solely out of the assets of such Stockholder. Each
Stockholder hereby irrevocably waives any right it may have against any such
officer, director, stockholder, limited partner, general partner, owner,
successor or assign identified above as a result of the performance of the
provisions under or contemplated by this Agreement. Nothing in this Section
7(e) shall prevent Promus from obtaining specific enforcement of the
obligations of any Stockholder under this Agreement.
(f) This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which together shall constitute one
and the same instrument.
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Signature Page for Stockholder Support Agreement
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed by their respective duly authorized officers as of the
date first written above.
GE INVESTMENT MANAGEMENT INCORPORATED
/s/ John Myers
----------------------------------------
By: John Myers
Its:
GE INVESTMENT HOTEL PARTNERS I, LIMITED PARTNERSHIP
By: GE Investment Management Inc.
Its: General Partner
/s/ John Myers
------------------------------------
By: John Myers
Its:
TRUSTEES OF GENERAL ELECTRIC PENSION TRUST
/s/ John Myers
------------------------------------------
By: John Myers
Its:
RED LION
By: RLA-GP, Inc.
Its: General Partner
/s/ Michael Michelson
------------------------------------
By: Michael Michelson
Its:
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Signature Page for Stockholder Support Agreement
/s/ Richard J. Ferris
-----------------------------------------
Richard J. Ferris
RIDGE PARTNERS, L.P.
By: Kelrick, Inc.
Its: General Partner
/s/ Richard J. Ferris
-----------------------------------------
By: Richard J. Ferris
Its: President
KELRICK, INC.
/s/ Richard J. Ferris
-----------------------------------------
By: Richard J. Ferris
Its: President
/s/ Peter V. Ueberroth
-----------------------------------------
Peter V. Ueberroth
THE UEBERROTH FAMILY TRUST
/s/ Peter V. Ueberroth
-----------------------------------------
By: Peter V. Ueberroth
Its: Trustee
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Signature Page for Stockholder Support Agreement
THE UEBERROTH INVESTMENT TRUST
/s/ Peter V. Ueberroth
----------------------------------------
By: Peter V. Ueberroth
Its: Trustee
Agreed and Acknowledged:
PROMUS HOTEL CORPORATION
/s/ Raymond E. Schultz
- -------------------------------------------
By: Raymond E. Schultz
Its: President and Chief Executive Officer
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